Business in Ghana

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Can A Vampire State Achieve A Great Leap Forward? Analyzing the Political Economy of Ghana

Posted by Business in Ghana on September 23, 2012

Ben Ofosu-Appiah, Tokyo, Japan.

South Korea went from a poor country devastated by war to an OECD member in 50 years. In the same period of time Ghana went from a country with a high potential for take off to one that stagnated at best and standards of living declined or backwardness.

In many parts of the country, hundreds of kilometers of colonial roads have disappeared, schools and clinics are in dilapidated state and social infrastructure have been allowed to collapse. In 55 years not even a single kilometer of railway line has been constructed and the one the colonial rulers left have been allowed to deteriorate and collapsed. Something is definitely wrong and needs to be put right now. Leadership failures and an incurable greed have been our bane. Our motherland is under enormous strain today due to the unbridled quest for material gains using the state machinery. Cronyism, nepotism, favouritism, political patronage are turning the democratic governance on its head. When will political leaders ever roll up their sleeves and get to work for mother Ghana rather than seeking to fill their pockets first acquiring material gains?

Much has been said about Ghana as an economy on the move recently: One of the best performing economies in Africa and the world at large given its 14% growth rate in 2011. However, let’s look at the following: What’s the unemployment rate? Average household income? Has it risen over the years and by how much? On all these fronts, the news is not good. “It’s exciting, it’s challenging, there are limited opportunities and there are lots of frustrations as well”. A friend who recently returned home remarked.

The country is in deep crisis and the biggest problems at hand now are corruption, poverty, and unemployment. The labour force in the country is growing at 5% per annum or more creating unprecedented labour tensions and the result is a huge unemployment problem among the youth. More than half of the jobless rate in Ghana today is accounted for by people in their 20′s and 30′s. This is very alarming. Figures are hard to get by but it is abundantly clear that about six out of ten University graduates this year are without jobs not to count Secondary school and Technical School graduates.

There is no system in place to absorb new graduates into the workforce as new graduates are left on their own to fend for themselves. I was moved to tears the other day as I listened to a forty something year old University graduate giving a testimony at church for landing his first job. He was so happy and thankful to God for giving him his first job. Obviously I was happy for him too because he counts himself so lucky to have a job while many of his colleagues were still searching. But at 40? In many places, at 40 you are already a senior manager not starting your first job and there is no cause for celebration. The need to create new opportunities is more crucial than ever. The dilemma facing us now is not only that more than 250,000 people join the job market every year, but that many of them are well educated and naturally have higher expectations.

Lack of job after the first degree forces some people back to school hoping that if they get a Masters degree things would be better but they come out to meet even a tougher job market. How can we take care of our youth as a nation if we don’t care whether they are getting the right experience at the right time? The fear of the unknown has kept many Ghanaian graduates from foreign universities staying abroad. They are scared they may not get a job if they come home. The jobless rate rose as “positive change” and “better Ghana” failed to create jobs for new graduates entering the job market but helped those in government to develop “pot bellies”. Since there is an absence of a viable private sector in Ghana, the onus of creating jobs fall squarely on the shoulders of the government, and government needs to create about 400,000 jobs annually if the unemployment rate is to reduce. The government must take the lead in economic development and not leave it to a non-existent private sector.

Yet the newly rich and their wealth are on display everyday: New flashy cars, even private jets, luxury malls and supermarkets, expensive restaurants, quality arts and concerts and frivolous beauty contests  whose tickets go for anywhere between 50 -100 dollars for a country where over 60% of its population live on less than 2 dollars a day.

How are public work construction projects faring under the so called boom in our economy? No meaningful development can take place under a situation where the country’s infrastructure is dilapidated and no public work projects are underway to rejuvenate them for real developmental takeoff. No city center redevelopment projects are being undertaken to facelift our cities, Accra stinks to high heavens from the dirty gutters and its deplorable sanitation problem. No public transport (railways, buses, trams etc) redevelopment. No high rise business towers being put up. No public housing projects in a country with such a huge housing deficit. No new hospitals or expansion of existing ones. There is a huge infrastructure deficit: Can Ghana’s infrastructure handle its growth?

What do you see in reality:

May be Ghana is growing and getting richer, but not everyone is earning a resource (Oil) sector wage. The benefits of the boom are far from being shared. There must be a shared prosperity, shared opportunities, and shared responsibilities for all. One of the things we have seen in recent years is a dramatic increase in the divide between those who have and those who have not. The rate of development we have been seeing here with the limited oil industry we have has pushed up the cost of living factors quite dramatically because there’s so much stress on the economy and on community resources. Go to Takoradi now and verify things for yourself. It makes you wonder if the so called oil curse has not set in already.

Accra and Takoradi are now pricier than Johannesburg, Lagos, Cairo etc Everything feels expensive from coca cola to movie ticket. A night out is very expensive on all fronts. But the biggest impact is on the housing market. Already we have a huge housing deficit. Rents are up over 100% in the last few years There’s a country wide housing crunch. Average family income lags far behind the cost of living. If you talk about people on minimum wage, and those who have no jobs (there’s no income support from the state), then lots of people are really starving. The new phenomenon is the working poor: People who are in employment but cannot afford the cost of living because they are collecting minimum wage which can barely scrape the surface of this outrageous cost of living situation in the country.

We might be the fastest growing economy but we have no train stations worthy of service and no real highway of note except the George W. Bush highway and the motorway. A friend just remarked George W. Bush did more for Ghana’s development than any other Ghanaian leader with the possible exception of Nkrumah with no pun intended.

Across the country the pressure is being felt: Common complaints are clogged roads, erratic electricity supply, frequent water shortages, dirty environment, delays in accessing healthcare etc.The country has to concentrate on liveability issues: The critical thing is to formulate long term strategy. How would you make Ghana a better place and Accra a better city to live in? Almost good is not good enough. Long term development strategy is needed to tackle issues that are of strategic importance to Ghana.

Leadership is not about how much money you make for yourself and your family but how much difference you make in people’s lives and how you change lives forever. We owe the next generation a better Ghana than we found it. We are called to build something better so that the next generation can go on to build more than we could ever imagine. A lot in politics are just interested in having a job where everything is offered them free of charge rather than doing the job. They are just interested in the perks of office and occupying an office rather than doing the job.

The priority should be to do everything possible to wage a battle against poverty, raise living standards, and encourage businesses to thrive. Some 10 million Ghanaians live on less than one dollar a day, this is unacceptable and a shame. Ghana’s poor are less inclined to vote than the middle class because they have kind of resigned themselves to fate, that no politician nor political party can make a difference in their lives, thus virtually guaranteeing that their discontent would not prevail on the election day. Elections 2000 and 2008 were the turning points and just as there was a yearning for change in 2000 and 2008 that drove the people to the polls, I can sense the same yearning for change now and that will show in Election 2012. The Ghanaian electorate is growing impatient with the incompetence and greed of their political leaders.

The writer is a senior political and socio economic analyst and policy strategist based in Tokyo, Japan. He welcomes your comments. Contact him here:


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